Home prices are poised for another big tumble because the housing market is only showing more signs of weakness, said Richard Suttmeier of ValuEngine.com.
As pending home sales continue to dip throughout the country, more deterioration is expected.
Houses could lose more than half of their current value, based on the S&P/Case-Shiller index, Suttmeier told Yahoo Finance TechTicker.
“If it gets back, like stocks, back to the 1999-2000 levels, that’s another 50 percent down in home prices,” he said.
Ailing community banks and a lackluster job market are to blame, Suttmeier said.
Short sales of homes will become more common since results from the mortgage modification program have been weak, he said.
“People are going to be surprised when they see there have been short sales,” Suttmeier said.
Short sales only further push down the value of homes in a certain neighborhood, he said.
Consumer confidence has also dipped severely along with home sales, Bloomberg reported.
“The economy has entered a soft patch. Households are continuing to soldier on, albeit without much vigor,” said Richard DeKaser, chief economist at Woodley Park Research in Washington.
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